There are so many things to think about on divorce. The last thing on anyone’s mind is whether their state pension (SERPS or S2P or second state pension) has any real value. Let alone what income it will provide and whether it should be shared.
Pension sharing on divorce has come a long way over the past 15 years. It has had to, to keep pace with the changes in society and pensions generally. There are so many types of pensions these days, all from different schemes and with different rules. Pension sharing has now become a specialist area in itself. With very few solicitors having the right level of expertise to advise.
When it comes to the divorce process, it is not uncommon for spouses to forget about any pensions when dividing their assets. Often pensions are the most valuable asset of a marriage. But even when clients have remembered to include the value of their pensions, they have rarely given any consideration to their state pensions.
To be able to share the state pension (SERPS) the person who is to receive the pension share must have reached state pension age before 6 April 2016. Or have issued their divorce petition prior to this date. An alternative might be for divorced couples to use their former spouses National Insurance contributions. This would be in order to boost their basic state pension entitlement. Using this method could boost one spouse’s basic entitlement without reducing the state pension that the other spouse receives.
How do you find the state pension age?
To be able to receive advice about whether to share your spouse’s state pension, you will need to know the state pension retirement ages. The government’s website provides this information. It is also possible to gain information about the pension credit system and a forecast of what income you are likely to receive from the state pension (including SERPS) on this website. All of which are useful even if you are not intending to divorce at any time!
If you are not able to share the state pension on divorce, there is still the possibility of the income being included when any maintenance calculation is considered. There may also be other pensions to consider. The general rule is to consider every asset and every source of income including that from any pensions.
It’s key to make sure you obtain early legal advice. Especially from a Resolution accredited specialist who is experienced in pension sharing on divorce.
For more information on pensions and divorce, please contact our Family Law team on 0161 475 7676.